Your safest bet is to just follow IRS instructions exactly. Use your SSN for W-9s if you're a single-member LLC taxed as a sole proprietorship. Period. If you've been using your EIN incorrectly, contact those clients and send them updated W-9s with your SSN. It's better to fix it now than deal with notices and potential penalties later.

I've been dealing with this exact same confusion for months! As someone who just formed an LLC last year and got hit with my first W-9 request, I totally understand the frustration. The IRS guidance really is counterintuitive when you've specifically gone through the trouble of getting an EIN. What really helped me was talking to other LLC owners in my local business group. Turns out this is one of the most common mistakes new LLC owners make. We all assume the EIN is what we should use because it feels more "business-like" and professional. I ended up using my SSN on recent W-9s after reading through all the IRS publications, but honestly, the peace of mind from getting direct confirmation from the IRS (like some folks mentioned using Claimyr) sounds really valuable. There's so much conflicting information online that it's hard to know what's actually correct. One thing I'm still wondering about - if I do eventually grow to the point where S-Corp election makes sense, is there any issue with having some 1099s tied to my SSN from the early years and then switching to EIN-based 1099s later? Does that create problems for the IRS matching system or is it pretty straightforward as long as everything is reported correctly?

The actual stats on audit rates might make you feel better. For small Schedule C filers (under $100k), the audit rate is around 0.9%. Even with multiple years of losses, unless you have other major red flags, your chances remain relatively low. Make sure you can document that your expenses were legitimate business costs, not personal expenses, and you should be okay.

Has anyone here actually been audited for a small business with losses? I'd love to hear a firsthand experience about what happened and how it went.

Ask the preparer to give you an itemized breakdown of which specific tax credits they're claiming for you. Any legitimate tax professional should be able to clearly explain exactly which credits you qualify for based on your situation and documentation. If they give vague answers or refuse to explain, that's a huge red flag. Also, get a copy of your full tax return before you pay them or agree to anything!

Good call on going with your aunt instead! As someone who's been through tax season nightmares, that $5k fee was definitely a red flag. Legitimate tax preparers typically charge based on complexity, not as a percentage of your refund. For a return with W-2 and 1099 income, you'd normally expect to pay somewhere in the $200-800 range depending on complexity. The fact that she could magically make $8-9k of your refund "disappear" by removing certain credits suggests she was likely planning to claim things you don't actually qualify for. When preparers talk about getting massive refunds that others "miss," they're often referring to fraudulent claims that can land you in serious trouble with the IRS later. Your aunt, working for an established tax prep company, will follow proper procedures and only claim legitimate credits and deductions. You made the smart choice - better to get an honest, accurate return than risk an audit and penalties down the road!

WARNING: Be careful about reasonable cause. My husband tried this last year for his consulting business and it got REJECTED. He had to file as a sole prop for half the year and then as an S-corp, which meant TWO different tax returns and a ton of accounting headaches. The IRS is getting stricter about these late elections. Make sure your reasonable cause is actually reasonable and not just "I didn't know about it." We learned the hard way that "I was busy with client work" isn't good enough. If you're serious about making this work, talk to an actual tax pro who specializes in business formation, not just random internet advice.

I went through this exact situation 2 years ago as a freelance web developer. Here's what I wish someone had told me upfront: The timing is crucial, but you have more flexibility than you might think. You can form your LLC in August and still get S-corp treatment for your entire 2023 income, BUT you need to act fast once the LLC is formed. My recommendation: Form the LLC immediately in August, get your EIN the same day (you can do this online), then file Form 2553 within 2-3 weeks. Even if you're technically "late" by a few days, a simple reasonable cause statement explaining you're a first-time business owner unfamiliar with the election deadlines will likely be accepted. The key advantage is that once approved, you'll file a single 1120-S for the entire year instead of splitting between Schedule C and S-corp returns. This saves you significant accounting complexity and costs. One important note: Make sure you have reasonable justification for the salary vs. distribution split once you're an S-corp. The IRS expects you to pay yourself a "reasonable" salary for the work you do, with the remaining profits taken as distributions (which aren't subject to self-employment tax). Don't overthink this - thousands of freelancers make this transition successfully every year. Just don't wait until December to start the process!

Robinhood is the WORST with tax documents! I've used them for 3 years now and they always wait until the last possible moment. Last year they actually sent a corrected 1099 in MARCH after I had already filed! Anyone know if you can request them earlier somehow? Like is there a customer service number that actually works?

This is exactly why I always recommend keeping detailed records of your own trades throughout the year! While you're waiting for Robinhood, you can use your own transaction history to get a pretty accurate estimate of your capital gains/losses. If you log into your Robinhood account, you can export your transaction history and calculate your gains/losses manually. It's tedious but doable. Just be extra careful about wash sale rules - those can be tricky to calculate on your own and might differ from what Robinhood reports. Also, for future reference, consider switching to a broker that actually cares about getting tax docs out early. I moved from Robinhood to Schwab last year and got my 1099 on January 25th this year. Life's too short to deal with Robinhood's terrible customer service and delayed tax reporting!